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The initial public offerings of high-tech wunderkinder like
Linked-In
have Wall Street's bankers partying like it's 1999. But unless you're a well-connected customer, you probably won't be invited to partake in pre-launch share allocations.

Assets are spread across 25 to 100 diverse companies, providing a cushion from the kind of share-price fallback that LinkedIn (LNKD) experienced after its first-day pop, and that most tech IPOs suffered during the dot-com bust in 2001.

Granted, these funds offer only limited exposure to the most sought-after tech IPOs and their hoped-for first-day gains. But many investors are justifiably wary after the last tech IPO party, and for any investor not expert at valuing nonpublic companies, buying any IPO at its debut is fraught with risks.

Only a handful of new issues enjoy big first-day gains, says Sweet. But neither do many go bust. Most of the three dozen largest IPOs that have come to market since 2010 are still sitting on healthy gains, according to Dealogic. even after the recent market correction.

A resurgent IPO market has new candidates lined up to the horizon. Some 99 companies across all sectors will seek some $18.5 billion in the months ahead, IPO specialist Renaissance Capital reckons.

Among those whose soaring private valuations have whipped the market into a frenzy of anticipation are the social network Twitter, online gamer Zynga and, of course, Facebook.

But picking winners is always challenging. Active managers do that job for Renaissance's Global IPO Plus mutual fund. The largely passive First Trust US and Guggenheim Spin-Off use rules-based expert algorithms to configure their portfolios post-bacchanal.

Every quarter, First Trust Advisors' IPOX-100 Index adds companies with new initial offerings and removes those that have been in the index for 1,000 days. It's not active management per se; First Trust describes it as "semipassive indexing."

GUGGENHEIM SPIN-OFF APPLIES a slightly different spin, as it were, focusing on the progeny of established companies. Launched by Guggenheim Funds in late 2006, the ETF recently held a diversified mix of 25 companies of all sizes and sectors; they're chosen from the Beacon Spin-off Index. About half the fund's assets are concentrated in its top 10 holdings.

Because they have financial track records, spinoffs are more easily evaluated than are brand-new initial public offerings, maintains Bill Mitchell, CEO of Spinoff & Reorg Profiles, a Costa Mesa, Calif.-based research outfit and newsletter that tracks such opportunities. The Guggenheim fund gets rebalanced semiannually according to a proprietary risk/reward model that the Beacon Index applies to issues that have been on the market more than six months and less than 30 months. Like the First Trust US fund, it employs a multifactor model that makes Guggenheim another "semipassive" fund.

The Renaissance fund, by comparison, is actively managed in the truest sense of the word. Its holdings can turn over as often as three times a year at the manager's discretion–potentially increasing trading costs and tax exposure. Investors who buy in are betting that those costs will be offset by Renaissance Capital's 20 years of IPO market watching.

Having survived both boom and bust since its 1997 inception, the Renaissance fund's performance reflects the history of the tech industry. Its best one-year return was 115%, in 1999; its worst, a 52% loss in 2001.

A recent Renaissance share price of $13.54 represents a 29% return over the past year, compared with 39% for First Trust US, 36% for the Guggenheim fund and 30% for the S&P 500 Index.

First Trust US and Guggenheim both carry a 0.60% net expense ratio, which is about average for ETFs. The Renaissance fund's 2.47% expense ratio is rich even for a mutual fund, according to Morningstar.

The rating company gives First Trust US a four-star rating. Morningstar grants three out of five stars to the Guggenheim and two out of five to the Renaissance fund.

The
Direxion Long/Short Global IPO
Fund (DXIIX) is for experienced investors who'd like to play the share-price roller coaster for IPOs during their debut years. Besides its preponderance of long holdings, this fund uses derivatives to go long or short on issues as market conditions dictate.

Both of its managers, Josef Schuster and Darren Fabric, have extensive experience in futures markets. Schuster, founder of IPOX Capital and responsible for portfolio modeling and implementation, managed to snag an allocation of LinkedIn at its IPO price, and the fund benefited handsomely.

Direxion Long/Short will, typically, have at least 80% of net assets in equities rather than cash or credit instruments. It buys IPOs and spinoffs of both domestic and foreign issues. A relatively high 40% of its exposure is to international issues.

Recently priced at $30, Direxion carries a 1.90% expense ratio and requires an initial investment of $2,500. It has returned 6.65% over the past year.

ALL OF THESE FUNDS have relatively small market caps and average daily trading volumes, making them less-than-facile trading vehicles. None hold more than $30 million in assets. They aren't as risky as competing against institutions on opening day. But they still aren't for the faint of heart. some advice: Party with moderation.